Most of the cert petitions about eminent domain in recent years have focused on the "public use" side of the equation, and not on the "just compensation" side. That's not surprising, since the Kelo issue (the power to take) has been the object of intense public interest, so much so that as eminent domain lawyers, we no longer pass under the public radar. (We say "most" since there have been a few petitions on the compensation issue, all denied. Here for example.)
But now comes this cert petition (River Center LLC v. The Dormitory Authority of the State of New York, No. 11-922 (cert. petition filed Jan. 23, 2012)) which presents three questions focused directly on the Just Compensation Clause. It's a case we've been following as it worked its way up through the New York state court system, and it is now ripe for U.S. Supreme Court review. And did we mention that the counsel of record for the petitioner is none other than Harvard lawprof Laurence Tribe? Professor Tribe has argued property rights in another recent Supreme Court case, and any cert petition in which he represents a party is sure to have a slightly higher chance of catching the Court's attention than others (or at least the attention of the cert pool clerk).
The New York courts declined to consider the owner's evidence that until the condemnation, it was reasonably probable that it would be able to develop its land, concluding that the evidence was inadmissible because the owners could not show its plans would come to fruition in the near future. This harkens back to the Court's decision in McCandless v. United States, 298 U.S. 242 (1936), in which it held that an offer of proof that irrigation water could be transported to the land was not too "remote and speculative" and should have been allowed in support of the property owner's contention that the highest and best use of the land taken was to grow sugar cane.
One of the reasons that River Center's development plans would not come to fruition in the near future was that the government deliberately interfered with those plans in anticipation of the future condemnation. This is the "Klopping" issue (Klopping v. City of Whittier, 8 Cal.3d 39, 500 P.2d 1345 (1972)), named after the case in which the California Supreme Court held that a condemnor's unreasonable precondemnation actions caused a lowering of the value of the targeted property. See also Gideon Kanner's thoughts on that issue here.
The petition poses these Questions Presented:
1. Whether the Fifth Amendment permits a state to deny compensation to an owner for loss of the reasonably probable development potential of a condemned development site taken through eminent domain proceedings, unless the property owner can show that development will come to fruition in the near future.
2. Whether, in awarding just compensation under the Fifth Amendment, a state may exclude damages resulting from deliberate governmental interference with a development project that delays development and suppresses the property’s value at the time of the taking over what it would otherwise have been.
3. Whether the Fifth Amendment permits a court in a condemnation proceeding to restrict evidence of value to the testimony of appraisers and to exclude or ignore otherwise competent testimony of property value (a) from the property’s owner, and (b) from third parties able to provide market-based evidence of value, such as financing proposals and offers to lease and buy.
This is one to watch. Here's the Court's docket report.
River Center LLC v. The Dormitory Authority of the State of New York, No. 11-922 (filed Jan. 23, 2012)
